In Short : The Asian Development Bank (ADB) has reaffirmed its support for advancing geothermal electricity generation in Indonesia. As part of its clean energy strategy, ADB aims to help the country harness its vast geothermal potential to reduce emissions, diversify energy sources, and achieve its net-zero goals while ensuring sustainable and inclusive economic growth.
In Detail : JAKARTA, INDONESIA — The Asian Development Bank (ADB) has approved a $180 million loan as the second additional financing to support PT Geo Dipa Energy (GDE)—an Indonesian state-owned company—to further boost the country’s geothermal electricity generation.
The Geothermal Power Generation Project supports the construction and commission of two geothermal plants each with a capacity of 55 megawatts in Java Island. The project will provide environmentally friendly base-load electricity to the Java–Bali electricity grid, reducing CO2 emissions by more than 550,000 tons per year. This additional financing will focus on supporting project completion against increasing costs and sustaining progress toward the country’s clean energy and climate goals.
“ADB is pleased to partner with the Government of Indonesia in advancing the country’s sustainable energy transition,” said ADB Country Director for Indonesia Jiro Tominaga. “PT Geo Dipa Energy plays a catalytic role in driving the next phase of geothermal development. We look forward to continuing our close collaboration to expand Indonesia’s geothermal capacity and accelerate the shift toward a cleaner, more resilient energy future.”
Despite having the world’s largest geothermal potential (29 gigawatts) and the second-largest installed capacity (2.1 gigawatts), Indonesia’s geothermal development remains slow due to the high cost, long duration, and high risk of exploration. Approved in 2020, the project supports GDE in geothermal exploration, development, and power generation while strengthening its capacity to plan and implement projects and conduct government-supported drilling to attract private investment.
As part of its community strategy focused on women, GDE allocates funds to improve women’s livelihoods through support for women-led small businesses and scholarships. It also promotes gender balance across its staff and contractors by integrating gender-sensitive approaches in its operations.
In 2023, ADB processed the first additional financing for the project, a $10 million grant from the Japan Fund for the Joint Crediting Mechanism (JFJCM), to incorporate advanced technology at the Patuha unit 2 power plant.
ADB is a leading multilateral development bank supporting inclusive, resilient, and sustainable growth across Asia and the Pacific. Working with its members and partners to solve complex challenges together, ADB harnesses innovative financial tools and strategic partnerships to transform lives, build quality infrastructure, and safeguard our planet. Founded in 1966, ADB is owned by 69 members—50 from the region.
